Why Is Roku the Top Streaming Platform for Investors

In anticipation of Roku’s launch in Europe later this year, we’ve decided to recap the most important facts about the platform: what it is, how it differs from other hardware options on the market, and why it has been so successful in the US. Roku may be an obscure name in many non-US markets, but the brand is one to be reckoned with. The ongoing rollout in new markets will further break the streaming status quo. If you are a developer or investor, an important opportunity might just be unfolding for you.

How popular is it?

For many years, Roku has neglected its expansion into new markets, losing the edge over other streaming device manufacturers. And while to an average European the brand may not mean much, it has always outsold streaming devices from giants like Google, Apple and Amazon in the US.

Streaming player market share in the US (Source)

The streaming landscape has been evolving and morphing for the past couple of years, but Roku’s popularity has not waned. The platform is still gaining popularity. Since the onset of the pandemic, it has gained 2.9 million more active accounts.

In Q3 2020, Parks Associates showed the numbers. Roku had a 38% install base, Fire TV followed with 33%. Contrary to common expectations, Chromecast was the only Google device on the list. Smaller providers haven’t even sold enough devices to gain a mention on the chart. But this just gives you the idea of the scale we’re talking about.

After many years, Roku is finally coming to Europe later this year. Here’s why it’s worth paying attention to it. 

The reasons for Roku’s popularity

Reliability and simplicity have always been the distinguishing features of the platform, making it the perfect choice for non-technical or elderly people. In terms of user interface, it is pretty much bare bones – in a good way, though. 

Roku checks many boxes. Consumers love it for its simplicity and advanced features. TV manufacturers partner with thee platform hoping to give their TVs powerful features on the cheap, and outsource the onus of software support to Roku. 

Smart TVs have been historically known for punishingly short update windows – rendering “smart” TVs “dumb” in a matter of 12-14 months. With Roku TV on board, this is never the case. The system is always up to date, working smoothly with no hiccups, offering a seamless watching experience for years.

For a more detailed comparison between Roku and Android TV, head over to another article on our blog.

Roku is platform-agnostic

Not many people know that Roku was originally developed to be the proprietary set-top box for Netflix. If it hadn’t been for Netflix CEO Reed Hastings who decided to abandon the device due to worries over competing with bigger hardware manufacturers, we would not have Roku today. Today, however, it is an independent, platform-agnostic device which is primarily competing with hardware manufacturers rather than streaming companies – mostly for its good.

This goes to say Roku has no ambitions of becoming the next Google or Apple. Because it has built its reputation as a provider of reliable OTT hardware, Roku does not have to compete with, nor favor any content provider. Users can freely install competing streaming platform apps and use them alongside. Similarly, Roku allows users to use voice control with Siri, Alexa, and Google Assistant – without favoring any of them. This freedom appeals to users. 

Roku supports all leading voice assistants (Source)

By comparison, Apple TV had not been available on Google TV for many years until it recently launched on the Google Play store (which sounds quite unbelievable today).

Roku <3 developers

The Roku OS is highly regarded by the developer world – and developing for Roku makes all the sense in the world. In certain markets, the platform is just too big to ignore. For example, when targeting US audiences, deciding not to make a Roku app may be a major misstep. 

However, and perhaps more importantly, the platform is just a solid performer – its devices work really, really well. No better way to please developers!

Hardware manufacturers <3 Roku

Roku has recently made its strides in the European market by partnering with the Chinese electronics company TCL. UK audiences had already been blessed with Roku’s presence with the launch of Roku-enabled Hisense TV sets in 2019.

The line-up of TV manufacturers partnering with Roku is expanding (Source)

With the roster of Roku TV Ready partners growing in numbers, there will be more Roku-based TV sets coming to new markets in the coming years. The German market is very likely the first beneficiary of this expansion. 

Some of the TV brands which use Roku in their TVs include brands like TCL (a long-time Roku partner), Hisense, Enclave, Sound United and Bose. The Roku TV Ready wireless soundbar is releasing in the coming months, which suggests the company is constantly experimenting with new hardware. Such is also the conclusion when looking at the company’s ever-expanding line-up of devices.

Roku is expanding its product portfolio, but the focus on hardware is very unlikely to be the company’s long-term strategy.

It doesn’t try to sell its own content

Unlike the competing streaming platforms Amazon or Apple (or Google), Roku does not use the hardware to push their content or services. It’s just not a part of their business model. 

While it is true Roku is still selling more devices than any other company in the US, they’ve also realized it is more lucrative to be part of the advertising industry. The platform displays ads on the home screen and the free channels that it carries. Conversely, the ads you see on other streaming services may be also sold by Roku. 

According to Business Insider, this new advertising-focused business model just makes sense for Roku as they sell 30% of a content partner’s ad inventory if their shows are to be available on its devices.

In other words, Roku doesn’t try to sell you its own stuff – but it might sell you some of Netflix’s stuff.

Clean interface

For many people – especially the less tech-savvy or elderly folks – Roku’s clean interface is a big selling point. This no-frills experience much resembles the traditional cable TV so many people are used to. 

Content appears right on the homepage as soon as you turn on the TV. Navigation is really easy. And yer, Chromecast may be comparatively better priced, but making the user select the “Cast to…” icon and always use the phone is a far cry from the convenience Roku offers through its fully-fledged, user-friendly interface.

The minimalist beauty of the Roku TV interface – categories on the left, apps (or, rather, “channels”) on the right

The price factor

Roku devices are simply an amazing bang for the buck. On top of that, much of Roku’s appeal lies in its multi-tiered pricing. It is never too expensive or too cheap – the company offers a model for every wallet – whereas most competitors don’t.

For example:

• If you want to spend as little as possible (or your TV just doesn’t support 4K) you will be fine getting the Roku Express.
• If you will be using the device with an older TV which only supports Full HD (and not 4K), some of the cheapest Roku sticks will do. Roku Streaming Stick+ is super affordable and provides mostly the same interface and playback features as the more expensive offerings. Its built-in long-range wireless receiver ensures stronger signal in rooms farther from your router. Extra features include Bluetooth streaming. The features of the Roku Express 4K+ are still there – but in a small, sleek stick which connects directly to your TV’s HDMI port. 
• If you’re after an advanced remote which supports voice commands, you will need to pay a little more for the premium Roku Express 4K+ model.

By comparison, the Apple TV 4K, which is the cheapest Apple TV model available today, costs a whopping $179. Roku Express 4K+ costs just $39.99. If you’re fine shelling out a little more, the most expensive model will set you back just $100, which is still much cheaper than Apple TV 4K. This is already an amazing deal, but also bear in mind these devices are also often on sale.

Apple TV 4K, Apple’s newest 4K streaming hardware offering

Direct Publisher

Roku makes it easier to launch your channel (app) and monetize content. Channels published using the Direct Publisher – simple, feed-based channel publishing tool – can serve ads to their viewers. 

The publisher can actually integrate its own ad server into the channel, or request to have Roku serve ads (this resembles the automated model known from YouTube Adsense). Understandably, only publishers meeting specific streaming thresholds are eligible for Roku to manage your ad inventory.

Baeble Music – a music video platform launched using the Direct Publisher tool

There have been many successful channels built through Direct Publisher, and the notable examples include Nosey, Baeble Music, Vidmark, Cracked, Rolling Stone, and FGTeeV and FUNnel Vision TV.

Last words

For many years, Roku streaming devices have been out of reach of European streaming enthusiasts. This is changing now, and as an investor, you can’t afford to miss it. 

With the official European rollout happening later this year, there will be a steep surge of users. Starting with the German outlets, the full line-up of Roku devices will soon be available through MediaMarkt, Saturn, Amazon, Expert, Euronics and Otto.de. Waves of new users will follow.

The platform has revealed the selection of entertainment services that will be available on launch in these countries. The meat-and-potatoes streaming platforms like Disney+, Netflix and Amazon Prime Video will be joined by local (German) content providers including ARD Mediathek, ProSieben Sat.1, KiKA, Netzkino, Kabel Eins, watch4.com and others. 

For many publishers and content providers, the European market is an opportunity that shouldn’t be missed. If you’re looking to develop a streaming app for Roku, drop us a line. We offer media companies and publishers valuable advice focusing on the right markets and developing on specific hardware platforms.We also provide quality development services backed by years of OTT industry experience. 

If you’re curious to find out what we can do for you, send us an email. Our experts will be happy to discuss your project.